This is how it feels: You're at the starting line, in pole position, feeling the awesome rumble of that finely tuned engine.You know that when that checkered flag is waved, you've got the speed to put you out ahead of your rivals and keep you there. At least that's how it will feel if and when you're really up to speed with broadband communications. Insurance companies are going to need that speed for their internal nervous systems, their connections with remote partners, and to the world at large, as IT-driven communications become increasingly pervasive. If you don't get up to speed, be prepared to watch the world race by.
It may seem like only yesterday the Internet arrived, bringing with it a whole new realm of customer expectations. But as the next generation of broadband materializes, Next-G Internet is evolving alongside, creating vastly new demands. "What we're beginning to see are new applications wrapped around the use of incredibly high bandwidth," says Rich Wall, program director for Internet technology, IBM (Armonk, NY). Along with that bandwidth, he continues, "we will see a whole new class of real-time applications, and the levels of reliability needed to support them, end to end, at a high level of quality of service."
This will ultimately mean succeeding at 24/7/365 communications, in data, voice and video-all at the same time, in real time-and in a secure and trusted environment. And with the inevitable advance of wireless, it will mean not only anytime, but anywhere.
GETTING ON TRACK
"If I were a CIO, I'd be concerned about taking a look at my infrastructure today-everything from where I have my day-to-day transactional-based systems running, how I interface these systems to the developing environment, and how it scales," Wall says.
Real time will affect CRM above all. "Instant messaging is becoming a vital link today-not just chat: It's the ability to log on, see who is online-maybe querying a policy or quotes-and join in the conversation and offer assistance in real time," he says. Customers shopping for better rates will be able to access intensive directed guidance, from experts online, Wall adds.
Since many existing applications were designed to perform ahead of the bandwidth status quo, moving quickly to get the faster pipes hooked has the potential to be liberating. "What has constrained total business benefit is that network infrastructures haven't been sufficient to deliver content as effectively and widely as possible," says Mike Stiles, director, applications marketing, FileNET (Costa Mesa, CA). IT departments are in a position where they have to work out a chicken-and-egg scenario between business goals and infrastructure investment. "Our recommendation is to seek opportunities. Don't let the current business drive infrastructure-get ahead of the curve. Those who invest in the infrastructure and utilize it with applications are going to reap the business advantage," he says.
Unfortunately, though insurers are aware that broadband is both technologically and economically viable, adoption continues to be slow. This is largely due to persistent problems with data quality. "As you look to disseminate information to broader audiences, the first thing you have to look at is how clean it is," says Scott Sargent, partner, financial services technology organization, Accenture (Chicago, formerly Andersen Consulting). "I see organizations doing a lot of behind the scenes clean-up, positioning for this capability versus taking advantage of it."
In systems that are not internally standardized or reconciled with a common middleware wrapper, customer information may be in 10 to 30 systems with 10 to 50 definitions, Sargent says. "I don't want to send one view of a customer in one channel and another view in another channel. It also might have some regulatory ramifications," he says.
Broadband strategies should be adopted with due caution, Sargent believes. "You do get what you pay for, but you should only pay for what you need. Most major carriers historically have probably overspent on communications, if you look at what they spent on networking and networking support."
TAKING SPEED SLOWLY
MetLife ($421.4 billion in assets, New York) shares Sargent's caution, at least in part. Three years ago it went from a connection-oriented point-to-point network to an IP connectionless network using an ATM (asynchronous transfer mode) backbone and frame relay. Since everything runs on IP (Internet protocol), there are no data-cleansing issues. "We're utilizing SONET synchronous optical network in our hubsite," says Bob Zandoli, vice president of network services. "For the remote access we're using evaluated network, UUNet and CompuServe using burstable T3 capacity that allows paying only for the bandwith employed at any given moment technology," he adds. "We're an AT&T New York shop when it comes to transport, and, for the most part, we're a Cisco San Jose, CA shop when it comes to data. For voice we use Lucent spin-off Avaya Basking Ridge, NJ, for the most part, using about 15 percent Siemens telephone switches."
MetLife has also just rolled out CTI (computer telephone integration) technology from Cisco subsidiary GeoTel (Lowell, MA).
"That's where we are today," says Zandoli. As for tomorrow, MetLife is piloting VPN, DSL (digital subscriber line) and cable modem technology, Zandoli says. "Given where we see the industry heading, we're moving toward VPN virtual private network and broadband. But we're taking it slowly."
The reason is that however ready a carrier may be, success still depends on the Internet's public infrastructure. "Are the ISPs Internet service providers ready to support mission-critical technology? The answer is that they're really not yet, because the quality of service between two ISPs can be markedly different," Zandoli says. Nor is it merely a question of infrastructure, he adds. "It's also the mindset: Are they thinking in mission-critical terms? Do they have the mentality that every moment they're down they're losing money?"
One of the greatest hurdles to jump in the broadband race will be owning the means to monitor what you don't own. Customers' demands can only increase, says Steve Sheinheit, MetLife's CTO. "There's no stopping it. It's somewhat generational and somewhat learned or trained." But the consequence is that being "able to deliver 7x24, 365 days a year, and being able to answer questions in the customer's time, is critical," he adds. Doing this on a mission-critical level will mean having ways of monitoring the public infrastructure, Sheinheit says. "To provide quality customer service we need a true understanding of end-to-end. When a customer calls and says they can't get in, we need to be able to find where that problem might be, have the means of diagnosing it, and provide support to that customer."
While current network environments remain too slow to handle richer forms of content, the good news, according to Sheinheit, is that they're developing rapidly and reaching acceptable levels of price performance. Telcos' investment in infrastructure has done much to drive these economics, Zandoli adds. "AT&T has many more POPs points of presence on their network than they had in the past," he says, bringing increasing bandwidth availability, and decreasing bandwidth cost.
THE DEATH OF THE SNOW DAY
Cost-effective broadband drove The Hartford ($167 billion in assets, Hartford) to move to a VPN, enabling robust outward-bound communications both domestically and internationally. But cost isn't the only thing driving broadband at the Hartford: workforce considerations are too, and in a big way.
Outside sales people at The Hartford were moved over to a VPN with broadband capability two years ago, says Ken Barger, CTO. "For personal connectivity we use Nortel Brampton, ON virtual private networking product over cable, DSL and dialing. AT&T is our ISP for international and US, dialing in to get into Nortel. For office-to-office connectivity we use both Nortel and Cisco products."
Today, big changes are afoot in call center and other areas amenable to part-time work. "We use a lot of part-time workers but they have to physically be in the buildings. It would be nice to extend right into their homes. We're able to do that in some cases, and as time goes on we'll be able to extend that more," he says.
This kind of flexibility benefits both employer and employee, Barger says. It serves as a powerful incentive to the employee and can make for an organization more responsive to unforeseen demands. For example, Barger asks, "How do you handle a major storm situation? Wouldn't it be wonderful if you could say, 'We don't want you to get in an accident and get injured, but we still need you to be a call center agent.' If you have the capability to have people work with full function, you can continue to provide an optimal level of service and not run in a degraded mode."
The problem is that while data applications may run well with the present infrastructure, managing voice and data together is still a dodgy proposition, Barger says. One obstacle is that there are quality-of-service challenges to be met in integrating data and voice, Barger says. Another issue is that broadband simply hasn't arrived everywhere yet.
"In different parts of the country where you can't get good cable and DSL, you're starting to see vendors start to offer more satellite capability to provide it," Barger says. Satellite broadcasting is nothing new, of course, but widely available commercial satellite service for robust two-way communications still is. Geographically conditioned demands will require full call center and video conferencing over satellite, Barger says. "There's going to be a lot of competition between satellite, DSL and cable. And that's great. It will help drive down the price and make it cost effective."
The Hartford is working with satellite technology vendors, but a non-disclosure agreement prevents Barger from identifying them.
In less-remote regions, cost effectiveness-combined with the emergence of non-traditional signal carriers-is inexorably leading to a VPN tidal wave, asserts Troy Centazzo, vice president of corporate development, Exario Networks (Parsippany, NJ). "The trend is away from WAN to virtual private networking," he says. In addition to being an economical alternative, he adds, VPNs also allow clients to outsource some functions while retaining control of the areas they wish.
There is also the option of Internet-based VPN, using client software. Centazzo argues that this option bears hazards relating to security and performance. Encryption provides some protection, he acknowledges, but says that from a remote workforce, software distribution perspective, "for the IT department it's an unmitigated nightmare to scale it up."
Nevertheless, he acknowledges that the struggle will be between Internet and proprietary backbone strategies as the VPN tidal wave rolls on. "It's going to come down to an execution game," Centazzo says. "Customers need to be careful; all the service providers say they do VPN, but the reality is that very, very few have much experience executing."
WIRELESS AND SPEED
Wireless will be an important part of that world of pervasive communications. And though its bandwidths may not be up to wired speeds, it still constitutes an indispensable part of the overall broadband picture.
"There are two ways to think about speed," says MetLife's Sheinheit. "One is the broadband concept of moving richer forms of information and data more rapidly. The other is speed of access: the flexibility and mobility that you get from wireless."
"Wireless devices are going to be in the billions of units within the next several years-it really changes the whole game of how people reach out and touch customers, how back-end engines work in a real-time transactional way," says IBM's Wall.
According to Wall's standards, these advances meet MetLife's Sheinheit's criterion of "speed as convenience." Says Wall, "All we're really doing is introducing basic Web application services that are now going to be enabled for Web based phones." Of course that will require infrastructure, and that is where fat-pipe speed will enter the wireless equation.
Nevertheless, as is all too clear, Wall acknowledges, a lot of ground is yet to be covered in order to take full advantage of the wireless advantage. High costs and questionable quality have affected growth in the US, "but we can already see what's on the horizon," he says.
Ground is being broken-literally-to bring wireless up to speed in the US, Wall says. "You're seeing fiber optics being laid with hundreds of strands still unlit, new hybrids of global high-speed network infrastructure companies emerging, and new wireless towers built all over." Providers abound, whether for cellular devices, landline or RF (low-level radio frequency) for wireless LANs. The issue of standard protocol is still to be resolved and much remains uncertain in making myriad applications suitable for wireless phone use, but "bandwidth and access will become a wash," Wall says.
Seeking Speed With DSL/VPN
AIG Claims Services (New York) wanted to provide remote connections to link personnel in areas such as loss control, investigative services and fraud detection, to its data center in Livingston, NJ. Dial-up speeds were too slow to run claims data-driven applications-and too insecure. T1 lines would work, but were "overkill," according to Kevin Murray, AIGCS CIO and senior vice president, AIG (New York, $268 billion in assets).
AIGCS looked to Exario (Parsippany, NJ) to set up a dedicated-circuit DSL pilot running on existing phone lines between AIGCS locations and the Exario's fiber optic grid.
Through the DSL network, AIGCS is able to expand the life of aging applications and look forward toward more complex and demanding ones, Murray says. Now, he adds, "I can look at claims at home at speeds that are 10 times that of dial-up. The only other way had been a T1. This is another avenue with almost the same speed, and it's secure."
Exario transmits voice and data over its proprietary, nationwide fiber-optic backbone consisting of 11 points of presence. Each POP is a carrier-class data center, meaning they conform to the same latency standards as major telecom carriers. "AIG was faced with the problem of having to connect 10,000 nodes that had been running on dial-up, 56K maximum," says Steve McConnell, senior account manager, Exario. "In order to run business applications they needed broadband, so they were faced with two choices: They could either quadruple staff at the data center to handle the task of provisioning a network, or find a partner who could do it for them."
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio